NatWest increases its growth funding to £3bn for small firms hit by Brexit

Wednesday 24th October 2018

NatWest has added £2bn to its original £1bn growth fund to help small businesses which are likely to be negatively impacted by Brexit. NatWest has identified circa 2,000 customers which it believes may need financial assistance to overcome their Brexit travailles and enable them to grow after we leave the EU. For the full story please read the article below which appeared in The Daily Telegraph today.

Roger Mundy, Managing Director, Beardsley Theobalds, 24th October 2018

NatWest trebles its £1bn growth fund for small firms hit by Brexit

NatWest has identified nearly 2,000 business customers it thinks may need extra cash to get through Brexit and extended support to small companies by £2bn.

The high street lender - which makes up the bulk of taxpayer-controlled Royal Bank of Scotland - said it was trebling its 'growth fund' for small businesses to £3bn, up from an initial £1bn pot unveiled in May.

NatWest said it had undertaken "in-depth analysis" of its customers and the wider market to determine which could be most exposed to any potential fallout from a disorderly Brexit. It said firms reliant on export and import trade with the EU, workers from the Continent or exposed to foreign currency movements were most at risk.

City regulators have been working closely with banks for months on preparations for a potential ‘no deal’ Brexit, which could lead to delays in cross-border payments and shipments. 

However NatWest is thought to be the first bank to publicly commit extra funds to help small companies.

It said it was proactively contacting 2,000 customers it believed could benefit from additional funding to support their supply chains and manage financial risks related to Brexit.

But it stressed the £3bn pot is open to all current and prospective customers. Of the original £1bn fund, £900m has so far been approved for investment.

NatWest said the new funding would be offered at "business as usual" pricing and would be dependent on the borrower and type of facility, but would not include a risk premium. Alison Rose, chief executive of commercial and private banking at NatWest, said the bank was committed to "help British businesses keep growing".

“The on-going Brexit process will require businesses to think strategically and tactically about how to navigate what is still an uncertain period ahead.

"We are committed to helping UK businesses access the right financing products so they can meet their short and longer term trade and working capital needs – whatever the outcome of the Brexit process," she added.

Bank bosses have previously warned of the potential disruption for UK companies if there is a 'no deal' Brexit, with one executive telling the Telegraph the industry may have to invoke a “Dunkirk spirit” to support the economy. 

However banks are better capitalised than they were before the 2008 financial crisis and have said they are confident they can cope with any disruption.